In the past few weeks, cryptocurrency has made headlines around the world, the rollercoaster of craze to criticism confounding investors who saw this digital coin as a new frontier for financial investment strategy.
However, there is one aspect of cryptocurrency which has remained stable throughout it all: regulators, like the Financial Conduct Authority (FCA), making strides to introduce new rulings regarding digital assets.
In fact, as reported by MSN, “The U.K.’s Financial Services and Markets Bill, which is set to give regulators in the country more power to regulate crypto including stablecoins is set to pass by Easter. Plus, the U.K. government wants to launch a consultation in the coming weeks regarding what other regulations need to be put in place for the sector. Policy makers have been calling for more regulation following the collapse of crypto exchange FTX.”
For financial firms based in the UK, these strides toward regulation mean only one thing: the time is now to prepare your firm and establish cryptocurrency policies and procedures which protect your firm and your clients.
Why?
As we’ve seen with the Securities and Exchange Commission (SEC), regulators are taking the regulation of digital assets seriously, with significant – and ground-breaking – cases being brought about in 2022. And we can only expect more of the same as UK bodies pass laws and rulings to govern UK-based financial firms.
For firms who haven’t done so, evolving your compliance program to incorporate cryptocurrency regulations requires a few different steps:
- Update your policies and procedures to reflect the evolution of the decentralized financial ecosystem.
- Establish firm-wide awareness – and implement continued education and training – of cryptocurrency regulations.
- Invest in a regulatory technology capable of meeting heightened regulatory activity.
While the future of cryptocurrency may seem uncertain, it is clear regulators have made it a priority for their 2023 agenda, planning to finalize rulings which will impact firms who deal with and in the decentralized financial ecosystem.
Working with a compliance technology vendor who has prioritized the evolution of their platform or software is critical to continuing to meet FCA regulations…whether crypto-related or otherwise. Ready to see how ComplySci has kept up with the pace of change in the regulatory landscape? Schedule a demo today.